Mr ABBOTT (Warringah—Leader of the Opposition) (09:01): I welcome the opportunity to speak on this climate change legislation. Let us be absolutely blunt about the bills now before the parliament. This is a bad tax based on a lie and it should be rejected by this parliament. The Prime Minister said yesterday that the question for members of this parliament was: 'Are you or are you not on the right side of history?' Let me say that this is arrogant presumption by a Prime Minister who is on the wrong side of truth. That is the Prime Minister's problem: she is on the wrong side of truth when it comes to this issue.

Let us consider the record of this Prime Minister on this subject. This is a Prime Minister—and we know this happened because her predecessor has described this in public—who sabotaged her predecessor at least in part because of her predecessor's desire to bring in an emissions trading scheme. She brought down her predecessor on this issue, and I say to the Australian people: if Kevin Rudd could not trust this Prime Minister, why should the people of Australia trust her on this subject? Not only do we have a Prime Minister who brought down her predecessor in part on this subject, but we also have a Prime Minister who revealed her true position on this subject in a secret memo to the inner cabinet, where she said that direct action would in fact work, that it was capable of bringing our emissions down by five per cent and it was capable of doing that without a carbon price. That is the one spark of truth that we have seen from this Prime Minister on this topic. But having sabotaged her predecessor over an emissions trading scheme, having told the inner cabinet that direct action would work, she then said to the Australian people at the election campaign that what we really needed was a people's assembly to deal with this whole question of climate change.

This citizens' assembly was not going to meet, listen to a few experts and then quickly decide what the policy was; this citizens' assembly was going to sit, it was going to deliberate, it was going to keep deliberating and it would not come to a conclusion that would be acted upon by government until there was 'a deep and lasting consensus'. So far we have had three positions from the Prime Minister: first, sabotaging her predecessor over an emissions trading scheme; second, telling the inner cabinet that direct action would work; and, third, a citizens' assembly that would not conclude until 'a deep and lasting consensus' was achieved. Talk about a real Julia and a false Julia; the fact is that when it comes to this subject there seems to be no real Julia at all, because having had all of those different positions we come, finally, to her pre-election statement—I would say her fatal pre-election statement—that 'there would be no carbon tax under the government I lead'.

This is the statement that haunts this debate. This is the statement that haunts this government. This is the statement that makes the whole debate we are having fundamentally illegitimate, because this is the very tax that this parliament should not be considering. Let me say this, Mr Speaker: it is one thing to change your mind as circumstances change, it is an entirely different thing to pervert the democratic process of this country by saying one thing before election to win votes and to do the exact opposite after the election to hold onto your job. That is precisely what this Prime Minister has done. What she has not done is the decent, honest thing, which would have been to take a change of position, had that genuinely taken place, to the people at an election.

This is a Prime Minister who has from time to time compared this carbon tax to the great reforms of previous governments. She has even compared it to the great tax reform of the former government of the former Prime Minister Mr Howard. But the fundamental difference between the Prime Minister sitting opposite today and the Prime Minister who took the tax reform package through this parliament is that he took it to an election first. If the arguments for the carbon tax are as strong as this Prime Minister says they are, why hide from the people? Why not expose these arguments to the people? I say to this Prime Minister that if she really does want a deep and lasting consensus to be attained in this country, there is one way to do it, and only one way to do it: take it to the people and win an election on it. I say to this Prime Minister: there should be no new tax collection without an election. That is what this Prime Minister should do. If this Prime Minister trusts in the democratic process, if this Prime Minister trusts her own judgment, trusts her own argument, that is what she should be doing—she should be taking this to the people.

The whole point of this tax is to change the way every single Australian lives and works. That is another reason that this should be taken to the people. This is not just a minor bit of financial engineering. This is not just, if you believe the government, something to do with the revenue. This is a transformational change. This is something which is supposed to impact on our country not just today, not just next year, not just next decade, but forever. That is how important this is, if the government is to be believed, and this is why it should go to the people first.

This tax is all about making the essentials of modern life more expensive. Modern life is utterly inconceivable without fuel and power—without fuel to move us around the country; without power to make our homes, our businesses and our factories work. So, if this tax comes in, as the government wants it to do, we will not be able to turn on our air conditioner or our heater without being impacted by this tax. We will not be able to get on a bus or a train or, ultimately, drive our cars without being impacted by this tax. That is how important, how significant, this tax is. This explains the obvious impact that this tax will have on every single Australian's cost of living. This explains the obvious impact that this tax will have on every single Australian's job. And this explains why it is so necessary for this tax to go to the people before the parliament tries to deal with it. If this parliament is to have any democratic credibility on an issue like this, there must be an appeal to the people before a decision by the parliament.

The longer this debate lasts, the clearer it is that this tax is all economic pain for no environmental gain. On the government's own figures, under this tax there will be an immediate 10 per cent increase in electricity prices, a nine per cent increase in gas bills and a $4.3 billion hole in the budget. That nine per cent increase in gas prices and that 10 per cent increase in electricity prices is what we will get—well, we are not quite sure whether it is what we will get with a $23 a tonne carbon price or a $20 a tonne carbon price because they still have not given us the modelling on this. But once the price goes up to $29 a tonne—or to $131 a tonne, as it is forecast to do on the government's own figures—these prices for gas and electricity just go up and up and up. And that is the last thing that the people of Australia need, given that they have suffered from price rise after price rise in the 3½ years since this government came to office.

Let us look at what the Australian Bureau of Statistics tells us. Let us look at the story of price rises under this government. There has been a 51 per cent average increase in power prices. There has been a 30 per cent average increase in gas prices. There has been a 46 per cent average increase in water prices. There has been a 24 per cent average increase in education costs. And there has been a 20 per cent average increase in health costs. All of these prices are going to go up and up and up under a carbon tax.

As members opposite are only too well aware, since the carbon tax was first announced at the press conference in the prime ministerial courtyard, hijacked by Senator Bob Brown, and since carbon Sunday, I have been spending quite a bit of my time going around to the workplaces of Australia talking to the workers of this country—who, I regret to say, have increasingly been abandoned by members opposite. Just to give you a snapshot of some of the increases that will be faced by the employers of those workers that the Labor Party once represented: Austral Bricks—a $2 million a year additional cost; the Victorian hospital system—a $13½ million a year additional cost; Nolan's Transport in Gatton—a $300,000 a year additional cost. And it just goes on and on and on.

This is at a time when Australian business, particularly Australian manufacturing business, is under great pressure. This is at a time when the world financial situation is experiencing unprecedented fragility. And what does this government do? They do not think: 'Now is not the time to add to the burdens on business. Now is not the time to add to the burdens on families. Now is not the time to add to sovereign risk issues associated with Australia.' They do not think any of that. No, they think: 'What we need now is just another big new tax.' On top of the mining tax and all the other taxes that they want to put on us, they want a carbon tax as well. We heard from the Prime Minister yesterday that the carbon tax is somehow going to create jobs. This is a government which sometimes talks about economic credibility. Show me a credible economist, Prime Minister, who thinks that higher prices create more jobs. Show me a credible economist who thinks that higher taxes create jobs. This is not just nonsense; this is nonsense on stilts by a government which has no real understanding of the economy of the real world in which most of us live.

This government constantly tells us that the modelling shows most people will be better off. Well, there is modelling and there is modelling. This is a government which says that the modelling of the Commonwealth Treasury—and, as I said, it still has not given us the correct modelling—shows people would be better off. Well, that is not the only modelling. The Victorian government commissioned Deloitte Access Economics. Their modelling showed that there would be 23,000 fewer jobs across Victoria by 2015 as a result of the carbon tax—and members opposite should listen to this—with the Latrobe Valley, Geelong, Port Phillip, Monash, Boroondara and Whitehorse the worst hit areas. The Victorian government's modelling says that the Victorian economy will be $2.8 billion worse off in 2015 thanks to the government's carbon tax.

The New South Wales Treasury modelling—and this was modelling originally undertaken for the New South Wales Labor government when Michael Costa was the Treasurer of New South Wales—predicts that 31,000 jobs will be lost in New South Wales by 2030 as a result of the carbon tax, with 18,500 in the Hunter Valley alone. I say to members opposite representing Hunter Valley electorates: stand up for jobs in your area; stand up for the jobs of your constituents; stop making excuses for a floundering Prime Minister; and stop putting the political interests of this Prime Minister ahead of the economic interests of your constituents.

The New South Wales government predicts that state finances will be $1 billion worse off between now and 2014, with—listen to this, Mr Speaker—a reduction in gross state product of close to one per cent per year by 2020, and that electricity prices in New South Wales will rise by $498 next financial year as electricity generators pass on the cost of their carbon permits. The Western Australian Treasury modelling predicts that within three years Western Australian households will be paying more than $2,120 per year for power compared with $1,515 per year now.

Members opposite will say: 'They're just the coalition states. What can you expect from modelling commissioned by coalition governments?' Well, let us go to the Queensland modelling. The Bligh government commissioned a report from Deloitte Access Economics, and that modelled that Queensland's gross state product would be 2.76 per cent lower by 2020 and 4.11 per cent lower in 2050 with the carbon tax than it would be without one. That is a five per cent reduction in Queensland's gross state product under the carbon tax. Deloittes predicted a loss of 21,000 jobs in Queensland. And then there is the Queensland Treasury, which anticipates a net loss in the economic value of the state's generation companies of $640 million, all of which ultimately will be passed on to consumers.

Nearly all the claims that this Prime Minister is making for her carbon tax are wrong. It is a bad tax based on a lie, and the argument that she is marshalling for this tax is one lie after another. She talks about green jobs. A United Kingdom study released in March this year found that for every job created in the renewable energy sector 3.7 existing jobs were lost. A 2009 Spanish study found that for every green job created by subsidies and price supports for renewable power more than two jobs in other industries are lost. Her claims that no-one need worry about this tax because everyone is going to be compensated are wrong, even based on her own figures. Her own figures, in her own carbon Sunday documents, show that more than three million Australian households will be worse off.

These are not just rich people. A teacher married to a shop assistant: worse off under the government's package even by the government's own figures. A policeman married to a part-time nurse: worse off, under the government's own figures, thanks to the carbon tax. A single-income family with a child, on the government's own modelling, starts to be worse off from below average weekly earnings. That is what this government is doing to the struggling families, the forgotten families, of Australia.

The Prime Minister tells us that we have to introduce a carbon tax to keep up with policies in the rest of the world. Dead wrong. Since Copenhagen, if anything, the rest of the world has been moving against carbon taxes and emissions trading schemes, and in the period in which Australia intends to reduce its emissions by five per cent China is forecast to increase its emissions by 500 per cent and India its by 350 per cent.

Let me now come to the heart of my objections to this government's carbon tax proposal: it will not even reduce emissions. Every member of this parliament should go to page 18 of the government's 'carbon Sunday' document, Strong growth, low pollution: modelling a carbon price. I am looking at the government's own document. Our current emissions are 578 million tonnes. What we are supposed to be doing if we are to reduce our emissions by five per cent on 2000 figures is getting it down to 530 million tonnes. But the government's own figures do not say that we are reducing our emissions by five per cent; the government's own figures say that we are in fact increasing our own domestic emissions from 578 million tonnes to 621 million tonnes.

Mr ABBOTT: What is the point? What is the point of all the pain of this carbon tax if our emissions are actually going to increase? But it just gets worse. At a $29-a-tonne carbon tax, our emissions go up from 578 million tonnes now to 621 million in 2020. It gets worse. At a $131-a-tonne carbon tax in 2050, we do not get an 80 per cent reduction in emissions; we actually get a six per cent reduction in emissions. Our emissions in 2050, on the government's own figures, will have gone from 578 million tonnes to 545 million tonnes. So all of those bold claims in the Prime Minister's speech yesterday—all of that big chest-thumping talk of a massive reduction in emissions as a result of this tax—are utterly wrong and disproven on the basis of the government's own documents. We are not reducing our emissions; we are just engaging in a massive transfer of wealth from this country to carbon traders overseas.

That is what is happening under this tax. It will be $3.5 billion in 2020 to purchase almost 100 million tonnes of carbon credits from abroad. It will be $57 billion—1½ per cent of gross domestic product—shovelled off abroad by 2050 to purchase some 400 million tonnes of carbon credits from abroad. The Prime Minister claims that we are all going to get richer and richer under this carbon tax. Again I say to members opposite: if you do not believe me, look at your own modelling document, which says that Australia's gross national income per person will be almost $5,000 less in 2050 with the carbon tax than would be the case without it.

So what is the point of this carbon tax? We know part of the point: to satisfy the Greens, without whom this Prime Minister would not be in the Lodge and would not have been able to cobble together a majority after the election. But that is not the only point. Deep in the DNA of every Labor member opposite, I regret to say, is an instinct for higher taxes and greater regulation. And isn't that just what we are getting under this carbon tax proposal—more taxes, more bureaucrats, more regulation, more burdens on the life of the Australian people and more economic pain for no environmental gain whatsoever?

As I have been saying right around the country ever since this was proposed, there is a much better way to reduce emissions, and the better way to reduce emissions is to work with the grain of the Australian people and to further encourage the intelligent, sensible things that Australians and Australian enterprises are doing now to reduce emissions. Australian farmers are planting more trees, and they are doing it now without a carbon tax, because they know it is good for our environment and for their agricultural productivity. Australian farmers right now are moving from chemical to organic fertilisers. They are reducing emissions, and they are doing it not because of a carbon tax but because it makes economic and environmental sense. Australian businesses are taking sensible measures to reduce their fuel bills and power bills. Linfox has better trained its drivers and, as a result, its total emissions have reduced by 35 per cent since 2007. Visy are moving from high-emitting power from the Latrobe Valley to power that they are producing by burning the garbage that cannot be recycled. This is not just zero-emissions energy; this is negative-emissions energy, because that garbage would otherwise be emitting not just carbon dioxide but also methane in landfills. They are doing all of this without a carbon tax, and none of this would be easier—in fact, all of it would be harder—with the carbon tax that this government is proposing.

Listening to the Prime Minister, you would think Australians have been complete environmental vandals until this government came along with its carbon tax. I can tell the Prime Minister that, because of the environmental decency and economic common sense of Australians and Australian businesses, our emissions intensity is 50 per cent down over the last decade and a half, and all of that happened without a carbon tax. All of that is going to be put at risk by the carbon tax which this Prime Minister now wants to put in place. True environmental progress will be harder with a carbon tax. True environmental progress will be encouraged and facilitated by the direct action policies of this coalition. Let me say that, when it comes to our direct action policies, they are costed, capped and fully funded from savings in the budget. This carbon tax proposal from the government would be disastrous for our democracy. How can Australians continue to trust our democracy when the biggest and most complex policy change in recent history is being rammed through this parliament by the most incompetent government in recent history? It is the biggest and most complex change sponsored by the least competent government in recent times. Not only does this government not have a mandate to do what it is proposing; it has a mandate not to do what it is proposing. That is why this package of bills is so disastrous for our democracy.

It is disastrous for our democracy, and it is disastrous for the trust that should exist between members of parliament and their electorates. Why are the members for Throsby and Cunningham sponsoring such damage to BlueScope and to the coalminers of the Illawarra? Why is the member for Hunter and the other Hunter Valley members of the government doing such damage to the heavy industries and to the coalmines of the Hunter? How can the Climate Change minister talk to his constituents with a straight face, given what he is doing to them? How can the member for Capricornia want to close down so many mines in her electorate? How can the members for Corio and Corangamite be doing this to the cement industry and to the aluminium industry and to the motor industry of Geelong? What we have from this government is politically, economically and environmentally disastrous. But it is more than that; it is going to turn out to be the longest political suicide note in Australian history.